Identity theft soars as gangs target wealthy

Identity theft has soared by two thirds so far this year, with Londoners most likely to be targeted.

A report out today shows people living inside the M25 are almost four times more vulnerable than average.

The most targeted areas are wealthy neighbourhoods. In the worst hotspot, Kensington, the risk is five times higher.

The study, by credit rating agency Experian, found Wandsworth, Victoria and Queensway were the next most affected.

All have affluent populations who frequently use credit and other cards with high-spending limits, providing rich pickings for gangs.

The areas also have many bars, hotels and restaurants, where there are easy opportunities for stealing identity details. In addition, Londoners are more likely to live in large houses divided into flats, where it is easier for criminals to intercept post, and they move more frequently, leaving a trail of misdirected letters and old addresses.

The report shows that across the country, cases of ID theft in the first half of this year were 68 per cent higher than last year.

Although chip and pin has reduced card cloning, gangs have become more sophisticated in creating virtual identities that can be milked for cash.

The fastest growing trick involves having post from a bank or credit company redirected to a "new" address where it is picked up by the fraudster. Cards can then be used for buying goods on the internet, or if the fraudster has a Pin, for withdrawing cash.

On average, each identity fraud in the first half of this year involved the loss of £680. For fraudulently obtained personal loans, the average cost was £6,138, up from £4,797. The total cost to the economy is estimated at £1.7 billion.

Helen Lord, fraud and regulatory compliance director at Experian, said: "The rate of fraud growth is scary. No one should be complacent - they need to take steps to protect themselves."

She urged people to monitor expected post so missing items are detected quickly, ensure banks and other institutions and companies are told of address changes and have mail forwarded to a new address for at least six months.

Checking credit reports can reveal if unauthorised accounts or cards have been taken out in the cardholder's name.

Owen Roberts, consumer head at credit protection company Call Credit, said: "Always check statements and watch for small unrecognised transactions - these can be a precursor to serious spending by a fraudster.

"A good example is a fraudster buying a single music download for £1 to prove the card details are real. Once it goes through they will start a spending frenzy."